by Sellick Partnership | 16 August 2016
Businesses are finding it increasingly difficult to retain a motivated and productive workforce. A new generation of workers is emerging that not only expect more from their employers, but are generally more difficult to satisfy. Previously in our employee retention series we discussed the issues employer's face when retaining staff in a competitive market. In this section we will look more closely into the reasons that cause employees leave their jobs. Next week in our final part of the series “Employee retention: how to sustain a happy workforce” we will outline effective strategies and ways in which employers are adapting to hold onto their workforce.
1. Age and opportunity
Age is a key consideration when looking at employee retention, particularly when taking into account the increase in younger workers looking to further their careers. Graduates are now seeking roles that offer clear career progression opportunities and attractive remuneration packages. Graduates no longer find it necessary to stay for long periods of time with the same company in order to get ahead. The drive and determination of younger workers to succeed is influencing their decision to move from job to job, a term frequently known as ‘job-hopping’.
Job hopping is becoming a common issue in business with 90% percent of younger workers believing it is acceptable to move on to a new role after only 12-18 months according to recent studies. For university graduates this can mean quicker career progression, but is leading to an increase in staff turnover across all sectors.
2. Lack of rewards and recognition
It is easy to underestimate the power of a ‘pat on the back’, especially for employees who are intrinsically motivated to succeed. Managers need to understand what motivates their team (for some, it is a raise; for others, it is public recognition) and then reward them for a job well done. Most employees will respond positively to an employer that is seen to appreciate the work they do. If a business does not have a rewards structure in place, top performers will lose motivation to build revenue for the business and will resort to doing the minimum amount in their day-to-day responsibilities, and without top performers to set the bar high, other members of the team may also lose the motivation and determination to succeed.
Top performing employees want to feel they are making a difference, and that their views and suggestions are being considered, and if they feel in any way they are not being listened to or taken seriously they may begin to resent the management team and the organisation. In the recruitment industry for example, employees in sales roles are target driven and respond well to monetary rewards and will often be motivated to do their best. A different approach is needed for non-sales professionals, whom may have the same drive and motivation to succeed, but can often not be targeted in the same way.
Training and development is also highly important. It is important for employees to have a clear path for progression, especially younger employees whom will often look for the next steps to advance their own career. An employee receiving no benefits, minimal in-house development or training and who does not feel challenged in their role are more likely to move on. This is especially the case for younger, career focused graduates looking for status and success.
3. The impact of the changing market on benefit packages
In today’s competitive landscape, employers have to be creative in how they structure remuneration packages for effective employee retention, and be acutely aware that salary increases alone are not enough. Employers should take the lead from their employees, and consider all reasonable requests from staff. Taking into account changing behaviours is important here, the values of the new generation currently entering the job market are very different to that of their older counterparts. Employers should explore the motivations of the younger generation and decide what it is they look for most, namely clear career progression and excellent benefits. In comparison, professionals in more senior roles tend to require more flexibility and optional extras such as healthcare, flexible working or private parking to fit in line with their changing lifestyle.
Retaining a strong and efficient workforce is undoubtedly one of the most important factors in running a high-performance business, and one that will have a direct impact on profitability and success. In recent years, due to dramatic economic changes within the business community coupled with the changing hopes and aspirations of employees young and old, it has become more difficult for organisations to prioritise retention. In failing to do so, businesses are putting themselves at increasing risk of damage that could be beyond repair. Looking at the future, businesses managing and maintaining effective employee retention strategies, and those building a strong, loyal and motivated workforce will unquestionably enjoy the most success.
Remember our next blog to be released next week “Employee retention: how to sustain a happy workforce” will deal with solutions for many of the issues outlined above.